Auto parts makers alarmed by leaked vehicle policy drafts
The Auto and Auto Parts Policy 2026-31 was cleared in principle by the prime minister in September, but Dawn reports the industry has only seen leaked versions.
Pakistan's auto parts manufacturers are working from leaked copies of the Auto and Auto Parts Policy 2026-31, a five-year document Prime Minister Shehbaz Sharif approved in principle in early September and which was sent for "IMF review" late last month, Dawn reported on Monday.
The policy covers 1,200 auto parts manufacturing companies. According to Dawn, those firms employ 300,000 people directly and 1.8 million indirectly.
No full text has been published. Dawn reported that several drafts are circulating and that nobody outside close government circles knows the exact contents of the document that was approved in principle and forwarded to the IMF.
The newspaper reported that the latest draft opens by acknowledging the scale of the sector and refers to $4bn in foreign exchange. It did not publish the complete text, and it did not say what the IMF review involves or when it will conclude.
Dawn reported that the manufacturers reacted with alarm after reading the leaked drafts, which set out a shift towards New Energy Vehicles. The report did not detail the specific provisions the companies object to.
Aaj English TV carried its own reporting on conditions in the industry, citing high electricity costs, taxes and wider business challenges as the pressures facing vehicle and parts producers. The outlet did not give figures for those costs in the material available.
The government has not released the policy document publicly, and Dawn did not report any statement from the industries ministry or from an industry association on the drafts.
Pakistan's auto sector has been one of the more protected parts of the manufacturing base, and a five-year framework running to 2031 would set the terms for investment in tooling, localisation and the transition away from petrol and diesel vehicles. For the 1,200 parts firms named in the draft, those terms decide whether existing plants can be retooled or will be displaced by imported components for electric and hybrid models.
Dawn's report places the policy in the queue of measures the government has shared with the International Monetary Fund. The prime minister's approval in principle in early September came before the document was forwarded for review late last month.
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